Repayment of what Greece owes to the European Central Bank should be pushed into the future, but it is not an option because it fills ECB chief Mario Draghi’s “soul with fear”, Greece’s finance minister said on Thursday.
Yanis Varoufakis said Draghi, president of the European Central Bank, cannot risk irritating Germany with such a debt swap because of Berlin’s objection to his bond-buying program.
Varoufakis first raised the idea of swapping Greek debt for growth-linked or perpetual bonds when his leftist government came to power earlier this year, But Athens has since dropped the proposal after it got a cool reception from euro zone partners.
The outspoken minister, who has been sidelined in talks with European Union and International Monetary Fund lenders, brought it up again on Thursday, saying 27 billion euros of bonds owed to the ECB after 6.7 billion euros worth are repaid in July and August should be pushed back.
“What must be done (is that) these 27 billion of bonds that are still held by the ECB should be taken from there and sent overnight to the distant future,” he told parliament.
“How could this be done? Through a swap. The idea of a swap between the Greek government and the ECB fills Mr. Draghi’s soul with fear. Because you know that Mr. Draghi is in a big struggle against the Bundesbank, which is fighting against QE. Mr. Weidmann in particular is opposing it.”